PremiumReliance Industries Limited (RIL), India's most-valued private company will hold its 43rd Annual General Meeting (AGM) on Wednesday. This will be Reliance Industries' first virtual AGM amid COVID-19 crisis. Thousands of shareholders across the countries are expected to join the meeting tomorrow. Mukesh Ambani-led Reliance Industries has recently become the first Indian company to cross 12-million market capitalisation.
The oil-telecom-to-retail major has successfully achieved its target set in the last AGM — to become a net debt free well before its schedule of March 31, 2021, by selling more than 25% stake in Jio Platforms, rights issue of ₹53,124 crore and stake sale to British energy giant BP in the petro-retail joint venture.
The AGM is "expected to report on progress on asset monetisation (INViTs and stake sale in O2C business), more details on strategic partnerships in digital business, growth plans on financial vertical, oil to chemical integration progress and new technologies," Morgan Stanley said.
Thanks to ₹1.18 lakh crore raised through Jio Platforms Ltd and the ₹53,124 crore rights issue along with stake sale to BP in the petro-retail joint venture, Reliance Industries has become e net debt-free well before its targeted date of March 31, 2021.
Mukesh Ambani is likely to discuss company's future plans following the recent partnerships with global social media giant Facebook at the 43rd AGM.
"The focus of the AGM is expected to be largely on product launches around RIL's partnership with Facebook potentially ranging from integration of JioMart with WhatsApp, additional colour on payments business and launch of a large product ecosystem (Super App) where Jio could integrate its services with WhatsApp," said Goldman Sachs.
Reliance's AGM on July 15 may also give a sneak preview of Ambani's vision for decarbonisation of energy molecules to create value-added products with almost no carbon emissions.
The AGM is "expected to report on progress on asset monetisation (INViTs and stake sale in O2C business), more details on strategic partnerships in digital business, growth plans on financial vertical, oil to chemical integration progress and new technologies," Morgan Stanley said.
Analysts also expect an update from Mukesh Ambani on oil-to-chemical division (O2C) deal with Saudi Aramco. The sale of a 20% in O2C business, which comprises of its twin oil refineries at Jamnagar in Gujarat and petrochemical assets, to Saudi Aramco for an asking of $15 billion has however dragged on, although Reliance Industries has said it is on track.
Goldman Sachs said it expects management to provide greater insights into the strategic partnership with Saudi Aramco and how that could fit into their ambition of an industry-leading oil to the chemical platform with over 70 per cent conversion of oil into petrochemicals.
"We expect investor focus to be on asset monetisation details especially on telecom InvITs and Saudi Aramco stake sale; capital allocation and growth strategy post-COVID-19; plans to leverage the partnerships with global technology peers and integrate its retail, digital and financials business; details on oil to chemicals integration and expansion of oil retail and new energy business with BP," Morgan Stanley said.
BofA Securities said of the five key initiatives announced in last AGM, RIL completed the strategic stake sale of Jio, petro-retail, and moved to zero net debt. "We might get an update on the remaining two - stake sale to Aramco and of Reliance Retail."
"We may get further updates on how RIL is looking capitalise on the digital trends and how it is leveraging and nurturing the start-up ecosystem," it said adding progress/update on other initiatives from last AGM like home broadband, online grocery/new commerce initiatives, Jio First Day-First-Show along with a few new announcements are expected.
In the 2019 AGM, Reliance Industries had outlined its ambition to be in the top 20 global retailers in the next five years. Following the recent launch of JioMart, the management is expected to provide more colour on the path to achieve this ambition.
JP Morgan said the AGM could have updates on Reliance Retail (large new commerce/e-commerce rollout).
"While we do not expect any large strategic investor in Reliance Retail any time soon, this is a key potential event the investors will be watching, especially as the Jio Platforms stake sale seems done," it said.
In the past, Reliance Industries has talked about 500 million customers being within its reach. Jio currently has a base of around 388 million subscribers. "We will look for any further colour on Jio's strategy to bring the next 100 million into the fold," Goldman Sachs said.
(With inputs from agencies)
